Question

estimating doubtful accounts

Estimating Doubtful Accounts Performance Bike Co. is a wholesaler of motorcycle supplies. An aging of the company's accounts receivable on December 31 and a historical analysis of the percentage of uncollectible accounts in each age category are as follows: Estimate what the proper balance of the allowance for doubtful accounts should be as of December 31. Performance Bike Co. Estimation of Uncollectible Accounts December 31 Estimated Uncollectible Accounts Percent Estimated Uncollectible Accounts Amount 3/4% Balance $834,000 91,700 Age Interval Not past due 1-30 days past due 31-60 days past due 61-90 days past due 91-180 days past due Over 180 days past due 41,700 30,000 21,700 15,800 Total $1,034,900

Answer 1

$ S Performance Bike Co. Estimation of Uncollectable Accounts December. 31 Estimated Uncollectable Accounts Percent Estimated uncollectable Accounts amount 3/4% $ 6,255 3% $ 2,751 7% $ 2,919 18% $ 5,400 42 $ 9,114 75% $ 11,850 38,289 Age Interval Not past due 1-30 days past due 31-60 days past due 61-90 days past due 91-180 days past due Over 180days past due Total 41.00 Balance 834,000 91,700 41,700 30,000 21,700 15,800 1,034,900 $ $ $